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IBM’s Watson Turned Into Cloud Products With WellPoint Help

Feb. 8 (Bloomberg) -- International Business Machines Corp. turned its Watson computer into a virtual assistant to cancer doctors, showing how it’s converting the high-powered machine into a revenue generator.

IBM worked with health insurer WellPoint Inc. and New York’s Memorial Sloan-Kettering Cancer Center to adapt the computer, which beat humans in “Jeopardy!” in 2011, into three commercial products. Watson will answer medical questions from doctors, researchers, medical centers and insurance carriers, the world’s largest computer-services company said today at an event in New York.

“This is a major milestone in IBM’s commercialization of Watson,” said Manoj Saxena, IBM’s general manager for Watson solutions. “We have significant plans this year for scaling Watson.”

The health-care products will contribute toward IBM’s goal of generating $16 billion in revenue from business analytics by 2015. By the end of 2013, 1,600 providers and 50 percent of nurses in the system of WellPoint, the second-largest U.S. health insurer, will be using a Watson product for recommending whether medical procedures should be approved, IBM said.

Health care faces a challenge of “too much information, not enough time,” said Lori Beer, the executive vice president for information technology at WellPoint. “Medical literature is doubling every five years. How do we keep up with that?”

More Accuracy

WellPoint, based in Indianapolis, plans to make money by helping doctors make more accurate treatment decisions, reducing the time it has to spend pre-authorizing procedures and selling the product to other insurers, she said in an interview. Neither company provided revenue forecasts for Watson services.

In 2012, Watson became 240 percent faster and 75 percent smaller so it can run on a single server, IBM said today. The Armonk, New York-based company now can install a Watson machine on-site for a business or remotely via cloud computing to a personal computer, tablet or smartphone.

Later this year, IBM will announce products for the finance industry similar to Watson’s health-care applications, Saxena said.

To contact the reporters on this story: Sarah Frier in New York at sfrier1@bloomberg.net; Alex Nussbaum in New York at anussbaum1@bloomberg.net

To contact the editor responsible for this story: Nick Turner at nturner7@bloomberg.net

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